80C Deductions in New Tax Regime: What You Need to Know in 2025

For years, most Indian taxpayers have relied on Section 80C to reduce their tax liability. Whether it was investing in PPF, ELSS, life insurance, or paying tuition fees, 80C has been the go-to tax-saving section.

But with the arrival of the new tax regime (Section 115BAC), many are asking: “Can I still claim 80C deductions in the new tax regime?”

The answer is important because the choice between the old and new regime depends heavily on whether deductions like 80C, 80D, and 80G are available. Let’s clear the confusion.

What are the Section 80C deductions in new tax regime?

Section 80C allows taxpayers to claim deductions up to ₹1.5 lakh on specified investments and expenses, such as:

• Public Provident Fund (PPF)
  
• Equity Linked Savings Scheme (ELSS)
  
• Life insurance premiums
  
• Employee Provident Fund (EPF, self-contribution)
  
• 5-year tax-saving fixed deposits
  
• Sukanya Samriddhi Yojana
  
• National Savings Certificate (NSC)
  
• Tuition fees for children
  

👉 However, under the new tax regime, Section 80C deductions are not available.

• This means that even if you invest in PPF or ELSS, you cannot reduce your taxable income using Section 80C if you choose the new system.
  
• The government’s idea is to simplify taxation, instead of rewarding investments through deductions, they have lowered the slab rates and provided zero tax up to ₹12–12.75 lakh.
  

So, if you want to use 80C, you must opt for the old tax regime.

Are Section 80D deductions available in the new tax regime?

Section 80D is one of the most commonly used deductions in the old system. It allows you to claim tax benefits on health insurance premiums paid for yourself, your spouse, children, and parents.

• Deduction limits under old regime:
  
  • Up to ₹25,000 for self, spouse, and children.
    
  • Additional ₹25,000 for parents (₹50,000 if they are senior citizens).
    
  • Overall benefit could be as high as ₹1 lakh.
    

👉 But under the new tax regime, Section 80D deduction is not available.

• Whether you pay for health insurance or medical check-ups, you cannot claim these expenses to reduce your taxable income.
  
• However, buying health insurance is still important for financial protection, it just doesn’t give you tax relief in the new system.
  

Are Section 80G deductions available in the new tax regime?

Section 80G provides deductions for donations made to charitable organisations, relief funds, or NGOs. Depending on the type of institution, the deduction could be 50% or 100% of the donated amount (with or without limits).

👉 Under the new tax regime, 80G deductions are not available.

• Donations will not reduce your taxable income if you opt for the new regime.
  
• The benefit continues only if you stay in the old regime.
  

This has been one of the major concerns for taxpayers who donate regularly, they no longer get tax relief for their contributions under the simplified system.

Why were 80C, 80D, and 80G removed in the new tax regime?

The government introduced the new tax regime under Section 115BAC with one main goal: simplification. For decades, the Indian tax system was filled with multiple deductions and exemptions, which:

• Made tax filing complex.
  
• Forced taxpayers to invest in certain schemes just to save tax.
  
• Led to confusion, especially for first-time earners.
  

By removing 80C, 80D, 80G, and many others, the government wanted to:

1. Reduce paperwork – no need to submit rent receipts, donation certificates, or investment proofs.
   
2. Increase transparency – everyone pays based on income, not on how well they know tax-saving tricks.
   
3. Put more money in hand – instead of locking money into schemes, taxpayers can decide how to spend or invest.
   
4. Widen compliance – a simpler system encourages more people to file returns honestly.
   

👉 In short: these deductions weren’t scrapped because they were unhelpful, they were removed to make taxation easier and more uniform.

Who should still consider the old regime for these deductions?

While the new tax regime is simpler and offers zero tax up to ₹12–12.75 lakh, the old regime can still be better for certain taxpayers:

• Regular investors: If you invest in PPF, ELSS, Sukanya Samriddhi, or NPS, the 80C benefit (₹1.5 lakh) can still lower your tax liability.
  
• Families with health insurance: Under 80D, premiums of up to ₹1 lakh (for senior citizen parents + own cover) can reduce taxes.
  
• Philanthropic taxpayers: If you donate regularly to charities or funds, 80G deductions make the old regime more rewarding.
  
• Home loan borrowers: Even beyond 80C/80D/80G, the old regime offers home loan interest deductions (24b) that are not available in the new system.
  

👉 In short: If you’re someone who is already structured around tax-saving investments and expenses, sticking with the old regime might leave you with more post-tax savings, even if filing is slightly more complex.

Conclusion

The new tax regime under Section 115BAC has changed the way Indians think about tax planning. Popular deductions like 80C, 80D, and 80G, which once formed the foundation of tax-saving strategies, are not available anymore in the new system.

Instead, the government has shifted focus to lower slab rates and a higher tax-free threshold (₹12–12.75 lakh). This means many taxpayers no longer need deductions to pay little or no tax.

But for those who already invest in PPF, pay health insurance premiums, or donate regularly, the old regime may still result in greater savings.

💡 The smarter move is to calculate your tax liability under both regimes and choose the one that aligns with your lifestyle, simplicity (new regime) or structured savings (old regime).

FAQs on 80C, 80D, and 80G in New Tax Regime

1. Is 80C available in the new tax regime?

No. Section 80C deductions (PPF, ELSS, LIC, NSC, Sukanya Samriddhi, etc.) are not allowed under the new regime.

2. What about 80D deduction in the new tax regime?

80D is also not available in the new system. You cannot claim health insurance premium deductions under the new tax regime.

3. Can I claim 80G deduction in the new tax regime?

No. Donations to charities and relief funds under Section 80G are not deductible if you opt for the new tax regime.

4. Why are 80C, 80D, and 80G removed in the new regime?

The idea was to simplify taxation by reducing dependency on exemptions and deductions, and instead lowering slab rates.

5. Who benefits more from the old regime?

Taxpayers who:

• Invest heavily in 80C instruments,
  
• Pay health insurance premiums under 80D,
  
• Make regular donations under 80G,
  
• Or have home loan interest deductions.
  

6. Is the new tax regime mandatory in 2025?

It is the default regime, but you can still choose the old regime when filing your ITR.

7. Does the new tax regime mean I shouldn’t invest in PPF or insurance anymore?

Not at all. Even without tax benefits, schemes like PPF, ELSS, and life/health insurance are essential for long-term wealth and security.